Why Resolute can't win in an ever-changing bush war

Long before global environmentalists had even heard of the oil sands, their Canadian target of predilection was the forest industry. Greenpeace and Forest Ethics waged savvy PR campaigns to persuade the world, and purchasers of wood and paper products, to boycott Canadian goods made from clear-cut forests.

It was a roaring success. Celebrities took up the cause and donations to the environmental NGOs came rolling in. Canada's biggest forest companies lost millions of dollars worth of business in what seemed a patently unfair attack on forest-management practices that, while far from perfect, remained head and shoulders above those followed in most of world.

It didn't matter that the environmentalists helped divert business from well-regulated Canadian companies to less conscientious ones in the developing world; the Canadian industry knew it could never win the public-relations war based on facts. Its solution was to embrace independent, third-party auditing of forestry practices to silence the critics, establish social licence and prove that Canadian companies operated in a sustainable fashion.

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Such third-party certification schemes came to supplant provincial governments, which wrote and applied environmental laws, as the final arbiters in determining whether a company's products merited the sustainable seal of approval. One scheme in particular, run by the German-based Forest Stewardship Council (FSC), came to be seen as the gold standard in certification. Achieving the FSC designation could be a costly process, but failure to achieve it could prove far costlier.

This was presumably the reasoning behind the decision several years ago by Montreal-based Resolute Forest Products to become one of the largest managers of FSC-certified forests in the world. Its efforts bought the world's largest newsprint producer a measure of peace – just not for very long.

Unlike confrontation, conciliation runs counter to Greenpeace's business model. It's harder to attract attention and money if you're actually working within the system. After Greenpeace, in December 2012, pulled out of the Canadian Boreal Forest Agreement – a multiple-stakeholder entente between environmentalists and industry – the FSC suspended four Resolute certifications in Ontario and Quebec covering almost 10 million hectares of forest. The reason for the suspensions involved an apparent lack of consent by affected First Nations and/or insufficient efforts to protect woodland caribou, a threatened species that is the subject of a recovery plan mandated by Ottawa in 2012.

The actions by Greenpeace and FSC have had serious economic repercussions for Resolute. Electronics retailer Best Buy, for example, said it would stop printing its flyers and newspaper inserts on Resolute paper. Axel Springer, one of Europe's biggest newspaper and magazine publishers, also pulled its business.

FSC recently reinstated one of Resolute's certifications covering about two million hectares in Northwestern Ontario. The certifications for about eight million hectares in Quebec and Ontario remain suspended, pending a mediation process FSC launched in Quebec last month. But Resolute argues that provincial governments are "the only appropriate overseers of a mediation process," since they are ultimately responsible for addressing First Nations concerns and protecting woodland caribou herds.

For Resolute, FSC certification has become a game of endlessly shifting goalposts. While companies in Canada have a legal "duty to consult" First Nations regarding resource development, FSC now proposes the more exacting standard of "free, prior and informed consent." FSC denies that this amounts to a First Nations veto, though that seems to be its effect. Even when granted, consent can be later withdrawn.

Resolute fears that another recently adopted FSC standard governing intact forests, or areas not previously touched by logging, would dramatically restrict its wood supply. With such requirements constantly ratcheting upward, Resolute questions "the viablility of FSC certification in the Canadian boreal forest." Yet its failure to regain its FSC certifications could mean countless millions in lost sales if Greenpeace and other environmental groups pressure more customers to drop Resolute as a supplier.

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This all threatens to reignite a war in the woods that FSC certification was designed to end. Bringing business, labour, environmental groups and First Nations together to jointly set forestry standards, as the FSC aims to do, was supposed to mean an end to boycotts and build trust in the process.

It hasn't worked out that way. Whatever good faith that might have existed between Resolute and Greenpeace is long gone. Resolute is suing Greenpeace for defamation as it publicly (and it turns out, erroneously) accused the company of violating certain terms of the Canadian Boreal Forest Agreement.

The FSC is now calling on Resolute and Greenpeace to work out their differences in a mediation process it will oversee. It does not look promising. Greenpeace has "been waging a campaign of demonstrable misinformation about the Canadian boreal and have also been specifically targeting Resolute with inaccurate, irresponsible and defamatory allegations," Resolute CEO Richard Garneau wrote in a Dec. 18 letter to FSC International executive director Kim Carstensen. "Rewarding that behaviour at the expense of [other eNGOs] seems not only unfair but unwise and short-sighted."

Resolute can't be blamed for doubting whether Greenpeace is really seeking solutions, or at least ones that it is prepared to live by for very long. That, after all, might hurt its fundraising.

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